According to TMZ, Chad Hurley was trying to get the lawsuit against him dismissed -- because he says he filmed the proposal without realizing he'd signed a confidentiality agreement before doing so.

But after reviewing the evidence, the judge in the case has determined that there's no way Hurley could've possibly missed the word "confidentiality" at the top of the one-page agreement, so he threw out the motion to dismiss the case.

And now in between cake tastings, dress fittings, and meetings with the florist, Kim and Kanye can giggle and grin over the fact that the lawsuit will not only go ahead as planned -- but over the idea that they could wind up pocketing millions out of it.

Get this one -- apparently this Hurley guy could be liable for fraud, which could lead to punitive damages. Did I mention he's one of the co-founders of YouTube and isn't exactly dirt poor?